The United States Energy Information Administration (EIA) has provided an update regarding the wholesale electricity prices level at the US major trading hubs. In 2017, they were relatively unchanged compared with the 2016 levels, in particular in US Eastern states. However, they increased in California and Texas by 18% and 27% respectively.
The main driver behind is the reduced volatility in natural gas prices and the low natural gas fuel costs, which contributed to more stable wholesale power prices across the US. This also enables natural gas to remain the dominant power generation supply source in the country for the second year in a row (32% of the total US electricity in 2017, compared with 30% for coal-fired power plants).
California's wholesale prices, which were in line with other hubs until July 2017, soared due to high electricity demand, which neared record hourly levels in the late summer. In August, wholesale prices during peak hours were 42% higher than in August 2016, and on 1 September 2017, day-ahead electricity market prices in the California ISO reached record levels (above US$200/MWh for four hours and US$770/MWh in one hour).